Initial OK from Lodi on delay for builder fees

LODI - City leaders in Lodi have given initial support to delay the collection of fees they charge builders to finance the effects of growth.

Daniel Thigpen

LODI - City leaders in Lodi have given initial support to delay the collection of fees they charge builders to finance the effects of growth.

Under a plan proposed by local builders and endorsed by Lodi's planning chief, developers would wait to pay the fees that finance road, water and sewer upgrades until a structure is occupied.

That's in contrast to the current practice, in which developers must pay the tab before pulling the building permit.

The City Council this week authorized city leaders to begin drafting the new rules, provided the city can revisit the issue again in three years to see if the changes are working or creating problems.

It would take two more City Council votes to implement the changes.

City leaders are not considering reducing the fees. With new construction slowing, Lodi collected nearly $667,000 in impact mitigation fees in the 2008-09 fiscal year.

John Beckman, chief executive officer of the Building Industry Association of the Delta, said the shift makes sense, because it can benefit builders' cash flows, freeing up money to construct something that might not have penciled out.

Many cities throughout the state already have made the change.

"In some places, it has allowed (developers) to build when they wouldn't have otherwise been able to," Beckman said.

In San Joaquin County, Lathrop and Manteca are considering similar measures, and Manteca is weighing fee reductions, Beckman said.

At a recent Lodi City Council meeting, Councilwoman Susan Hitchcock expressed concerns about deferring fee collections when the city often performs the public improvements in advance.

She ended up voting in favor of exploring the change, however, when it was proposed that the fee deferral sunset in three years.

"I don't want to lock us into something that would be difficult to get out of," Hitchcock said after the meeting. "I think it's, in this economic climate, something to look at."

Councilman Larry Hansen enthusiastically backed the proposal, saying he hoped it could be a small incentive to spur growth.

"Whatever we can do to start getting homes built and ... start improving the economy, I'm in favor of," he said.